DIVIDEND collections from government-owned and -controlled corporations (GOCCs) have reached a record-high figure in 2019, Finance Secretary Carlos G. Dominguez III said.
In a speech during a forum last week, Dominguez said this development was “unprecedented.”
“Dividend collections from GOCCs reached an unprecedented P69 billion last year,” the finance chief said comparing the P30 billion in dividends collected by government in 2015.
The total 2019 dividend collection is 34.77 percent up from P51.2 billion collected in 2018.
As of July last year, GOCC dividend collections have reached P61.3 billion.
For the January-July 2019 period, the top dividend contributors include the following: Philippine Deposit Insurance Corp.; Civil Aviation Authority of the Philippines; Bangko Sentral ng Pilipinas; Philippine Ports Authority; Philippine Amusement and Gaming Corp.; Philippine Charity Sweepstakes Office; Manila International Airport Authority; and the National Power Corp.
In the same forum, Dominguez said
the DOF is also expecting tax collections from sin products to increase by at
least 130 percent this year compared to that in 2015, as he cited preliminary
figures showing sin taxes almost doubling in 2019
compared to that in 2015.
“We are the first administration to raise excise taxes on tobacco products twice in a single term,” he said. “Within the first three years of this administration, a new set of sin taxes was imposed on electronic cigarettes and on alcohol. The additional revenue from these measures will help fund the Universal Health Care program that primarily benefits low-income families.”
Dominguez also said he believes the passage of the remaining tax reform packages, including the proposed Corporate Income Tax and Incentives Rationalization Act (Citira), will further improve the “inclusiveness” of the country’s economic growth, help produce a more business-friendly environment for investors, and empower about 1 million micro-scale enterprises, small-scale enterprises and medium-scale enterprises.
Dominguez added remains hopeful the Citira will be enacted into law this March.
“It will bring down our corporate income tax rate from the highest in Asean [Association of Southeast Asian Nations] to the regional average,” he said. “Our high corporate tax rate has been an effective deterrent to foreign investments, making us the regional laggard in this regard.”
From the current 30 percent, the corporate income tax is seen to be reduced to 20 percent under the bill.
This despite Senate President Vicente Sotto III earlier expressing doubt that the Citira and the Passive Income and Financial Intermediary Taxation Act (Pifita) will be passed before Congress adjourns on March 14.
The Pifita wants to “simplify” a complicated tax structure by cutting half of 80 combinations of tax base and tax rates on passive income and financial transactions. It also wants to remove tax on initial public offerings and reduce the stock transaction tax from six tenths of one percent to one tenth of one percent to further encourage capital market expansion.
Tax burdens on bank deposits, insurance premiums will also be reduced under the measure.